By Nell Mackenzie

LONDON, Feb 26 (Reuters) - Goldman Sachs prime brokerage said in a ‌note that the recent bounce in software ‌and IT services stocks may continue, even though this ​week, hedge funds were as short as they have ever been on the sector.

A short position expects an asset price to fall.

The ‌S&P 500 software ⁠and services index <.SPLRCIS> has tumbled over 18% this year so far, ⁠shedding more than $1.2 trillion in market value, according to LSEG data. But this week, stocks ​in this ​index recovered and ​the index rose over ‌4%

Key findings of the Goldman report:

* Goldman Sachs prime brokerage believes that the recentrecovery in software stocks will continue, it said in a note toclients on Wednesday, seen by ‌Reuters on Thursday. * Software ​and IT services were the ​top two ​shorted U.S.industries on February 24th on ‌Goldman Sach's prime brokeragetrading desk. * ​Short positions ​have risen to the highest level on recordfor Goldman, which began tracking positions ​in 2016. * ‌Long positions, betting these stocks will rise, ​stand ata record low.

(Reporting by Nell Mackenzie; ​editing by Dhara Ranasinghe)